Uncovering the Relationship Between Organizational Crisis and Innovation Speed

This article develops a conceptual model for studying the dual effect of the organizational crisis on innovation speed. Based on the original source of organizational crisis (exogenous vs. endogenous) and the type of perceived threat (realistic vs. latent), we categorize four types of organizational crisis, including environmental jolts related crisis, internal jolts related crisis, industrial revolution related crisis, and proactively constructed crisis. In developing the conceptual model, we integrate the predictions of the behavioral theory of the firm and the threat-rigidity hypothesis with regard to the allocation of organizational attention between survival and aspiration goals when confronted with each type of crisis. We also examine the moderating effect of high vs. low discretion organizational slack on these relationships. Our model extends current theory of organizational crisis and innovation speed.